San Diego’s tourism bureau, faced with the prospect of running out of funding after April, has issued layoff notices this week to 85 of its 100 staff members.

The 60-day notices, required by law for larger employers, is the latest fallout from the tourism funding feud between Mayor Bob Filner and the city’s hotel industry. Filner has so far refused to sign a key document that is needed before millions of dollars earmarked for tourism marketing can be released by the city.

A judge is expected to rule this month in a lawsuit brought against Filner by San Diego’s hotelier-run Tourism Marketing District corporation.

While the San Diego Tourism Authority is hoping to avoid actual layoffs, state and federal law requires it to issue notices if terminations are possible.

If the agency does not get is funding, the layoffs would take effect May 13.

“If we can, our intent is to not have any layoffs,” said Joe Terzi, CEO of the Tourism Authority, formerly known as the Convention and Visitors Bureau. “Then we’ve wasted all the training and education we’ve done with our staff.”

The only employees unaffected by the potential layoffs are the 15 sales team members who book major conventions and trade shows at the San Diego Convention Center. They’re covered by funding from the Convention Center Corp.

“The legal requirement is the primary reason for the notices, but the secondary issue is a lack of comfort that it will get resolved in time and if it does, how quickly can the money flow and at what levels,” said Terzi, who acknowledged that he already has received two resignations.

The tourism bureau, which already has had to cancel its $5 million summer advertising campaign, relies on the city’s Tourism Marketing District for about 80 percent of its budget. The five-year-old tourism financing district was renewed last year by the City Council, but Filner has been unwilling to sign a required operating agreement because he feels San Diego taxpayers are being shortchanged.

Revenues generated by the district come from a 2 percent surcharge levied on hotel guests’ room bills, approved by hotel owners last year in a mail ballot election.

Filner has asked that hoteliers give back to the city the more than $30 million a year the levy generates and that they guarantee higher wages and benefits for their employees.

When Filner and the hotel industry could not reach an agreement, the marketing district filed suit seeking a ruling compelling Filner to sign the tourism pact. A Superior Court judge will take up the case next Friday.

Terzi said that his agency, which has made some spending cutbacks anticipating a possible funding shortfall, has enough cash to keep the bureau operating through mid-May. It has asked its members to pay their dues early and is making a request of its landlord to temporarily forgive the rent that is due, Terzi said.

Even if the hoteliers win in court and Filner is compelled to sign the tourism marketing agreement, the funding freeze cannot be immediately lifted, explained City Attorney Jan Goldsmith. The city is facing two lawsuits challenging the legality of the hotel levy, and if it were to be overturned, the city needs to be legally protected.